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Frequently asked questions

Why is it that sometimes the System price in one or more hours is different from area prices even if all areas have equal price?

There are two situations that can lead to inquiries from interested market participants:

System price can be different from area price in an hour where all bidding areas have equal prices.

System price can be lower or higher than all area prices in one or several hours.

There are two things that may lead to a higher (or lower) system price than all area prices in one or several hours during one day:

Block orders

A block order is valid for a certain number of consecutive hours within a day. The block order may be accepted if the average price in these hours is equal to or better than the offered price of the block order.

The system price and the area prices are influenced by the selection of block orders that are accepted. A block order spanning over several hours may be accepted in one of the calculations but not in the other.

The system price doesn’t need to be equal to area prices even if we have equal area prices in all bidding areas in some hours, since the same purchase and/or sales blocks are not necessarily accepted/rejected in both calculations.

Flexi ordersA flexi order is not tied to any specific hour, and it may be allocated to the hour where its volume is needed the most in order to maximise the social welfare.

A flexi order may be accepted in one hour in the system price calculation but in a different hour in the area price calculation. Thus, the sales (or purchase) volume in an hour in the system price calculation may push the price for this hour to be lower (or higher) than the area prices for the same hour.

Why is it that sometimes a block order is not activated even though it is in the money?

This is a Paradoxically Rejected Block - PRB. There are different causes for PRBs:

Branching

Blocks can be rejected because they could only be fractionally accepted. Meaning not possible to fulfil the All-or-Nothing condition.

Cutting

After selecting the blocks, if no feasible price can be found (respecting all requirements), we know that the block selection has made the problem infeasible, so some of the blocks must be rejected (cut). There is however a limit on the depth of PRBs created in this way: Price calculation algorithm will avoid rejecting a block if it is deep in-the-money.

How is it possible that publication of price/solutions can be delayed?

For the day-ahead auction there may be different circumstances causing delays in price and results publishing or the reopening of order books for bid submission.

Technical issues in systems

Curtailment (Maximum price reached)

Price thresholds reached (Second auction)

Decoupling

Curtailment (Maximum price reached)

Some of Nordic TSOs and Nord Pool have together with the concerned regulators agreed on procedures for activation of peak load capacity in related areas for the day-ahead market in a maximum price curtailment situation. So, if maximum price curtailment happens in these areas, then it will trigger activation of peak load capacities. After activation of these capacities, the price calculation has to be rerun, therefore publication of prices can be delayed.

Price thresholds reached in UK (Second auction)

For the UK, upper and lower price thresholds are defined, in addition to the maximum and minimum prices. If the thresholds are exceeded, it will trigger a second auction with a reopening of order submission for UK market participants for 10 minutes. The members will be informed about the new time for order submission if this would occur. Currently the upper threshold is 500 GBP and lower is set to -150 GBP. In case of a second auction, auction results will be delayed. A second auction will also be performed for UK market participants if a threshold is reached in the CWE region.

Decoupling of market areas from the multi-regional coupling (MRC)

If for some reason, any of the MRC areas are not able to be part of the multi-regional coupling process, a decoupling of that market area may take place. In case of a decoupling, auction results will be delayed, reopening of order submission will take place and the affected capacities will no longer be included in the auction.